Sunday, July 29, 2012

Our
last post pointed out several reasons for a technical analyst to be bullish. The
NYSE A/D line has not broken its long up trend. The railroads such as CNR and
UNP are both above rising 10 & 30 Week MAs and close to 52-week highs (CP now
at a new 52-wk high) and now the broader stock indices brushing off Apples
earnings disappointment along with ignoring torpedoes like Faceplant – sorry I
mean Facebook and ZYNGA. Also our TSX the materials and the gold sectors have
completed a perfect Fibonacci 61.8 percent corrective retracement the great
2009 to 2011 advance.

Cycle
studies also have a bullish component. Our chart is the intermediate cycle
overly of five diverse major stock sectors, the S&P500, The iShares
Europe350, the iShares Latin America 40 and
the iShares MSCI Emerging Markets ETFs. There are five cycle principles, Summation,
Commonality, Variation, Nominality and Proportionality but in this example let
us deal with cyclic Commonality and cyclic Variation. Cyclic Commonality occurs
when the peaks and troughs of cyclic fluctuations of different markets are time
synchronized and cyclic Variation occurs when the cycle magnitude and duration
will shift due to fundamental differences in different markets

The
strategy is to observe when periods of commonality or variation are present and
to plan for the effect on the broader stock indices. Cyclic peaks tend to identify
important peaks and cyclic troughs tend to identify important bottoms and
cyclic Variation tends to introduce trendless markets. Enjoy!

Wednesday, July 25, 2012

Currently
there are many technical reasons to be bullish. The NYSE A/D line has not
broken its long up trend. The railroads such
as CNR and UNP are both above rising 10 & 30 Week MAs and close to 52-week
highs. The broader stock indices brushed off Apples earnings disappointment and
on our TSX the materials and the gold sectors have complete a perfect Fibonacci
61.8 percent corrective retracement the great 2009 to 2011 advance.

Also
of important note is the bullish trend reversal of Riverbed Technology, Inc.
(RVBD) after reassuring investors with better-than-expected earnings reports
and future guidance. The technical picture has changed suddenly with the
completion of an island reversal formation as displayed in our daily chart. Bullish
island reversal patterns are rare but very reliable. Next few posts we look at
the rails, the materials and the NYSE A/D line

Sunday, July 15, 2012

If
you're ever lost and on a deserted road without a cell phone, grab paper and
pen and begin an Elliott Wave count. Within seconds, a stranger will appear to
correct your wave count. Ask this guy for a ride.

The
problem has always been where to begin the wave count.

Students
of Elliott Wave will easily recognize the three advances (impulse waves) that
are interrupted by two corrections (waves) to be a perfect five-wave Elliott
bull market. The completed bull is then followed by a three wave A-B-C bear
phase.. Keep in mind cycle analysts have observed that, for the most part, bull
markets tend to persist for about 36 to 42 months and will contain three
separate and distinct advances or “up legs” which ties into the three impulse
Elliott Wave theory.

Our
chart spanning about 200 weeks of the S&P/TSX composite index appears to
display a complete Elliott Wave bull and bear phase if we begin the wave count
from the lows of March 2009. The first advance or wave (1) ran from the March
2009 low to the peak of mid-June. The first short corrective wave bottomed at
(2) in July 2009. The second advance or wave (3) ran from the mid July 2009 low
(2) to the April 2010 peak at (3). The second corrective wave (4) was longer
the corrective wave (2) and bottomed in July 2010. The final advance or wave
(5) ran from the July 2010 low at (4) to the final peak in April 2011 at (5).

The
bear phase is usually an A-B-C correction with time duration shorter than the
bull phase. The first, or A, down wave is a corrective wave that “comes out of
nowhere” and is initially thought to be a buying opportunity. In the example of
the TSX composite, the A down wave began from a price peak in early March 2011
and ended in early October 2011 for a loss of about 3,400 points or a 50%
retracement of the 2009 – 2011 bull phase.

The
subsequent rebound wave B ran from the lows of October 2011 and peaked in March
2012 retracing about 50 per cent of the losses sustained in wave A. During the
recovery wave B, many investors are still bullish because they still regard the
A down wave low to be a buying opportunity.

The
final C down wave can take many forms. It can be a sudden and sharp decline
accompanied by fear, confusion and panic, which is typical of a C wave bottom
or it could be shallow and not violate the lows of the A wave. In any event investor
temperament will change from bullish to bearish and may cause investors to
stampede out of risky assets such as cyclical stocks and into safe assets such
as utilities and telecoms. If this is a C wave bottom, then we start into a new
Elliott 1-2-3-4-5 wave advance that should run through 2013.

Friday, July 6, 2012

Anyone who follows BNN will eventually
get some free advice from the dynamic duo of Cole and John Stevens who claim
that when VectorVest suggests to “sell” or advocate to not buy stocks at this time – “you
should listen.” VectorVest of course sells a software package that claims in
its commercials, “better results than any TV expert or advisor.”

A few years ago I attended a VectorVest
user meeting in Buffalo N.Y. There were about 20 attendees – all of
whom were experienced investors. I found that one half of the users were
satisfied with their investing or trading results and the other one half were
not satisfied.

A
partial clip of the comments – with some out of context typos not corrected

Ed
Nov 24, 2010

Vector
vest is a mixed result trading programam. There several methods that will make
stock recommendations. Some are good and some very risky with no specific time
frame to hold the stock. I've tried it and gave up because there were way too
many methods or approches in which to receive the results. My results were
mixed but overall I lost more than I made.

seller
Atlanta Nov 23,
2011

I
have subscribed to Vectorvest for around 3 years and I would not call it a scam
although I have not had good results from the market timing system. Whenever
they do their back test demonstration to show you what great results they get
they pick a recent bottom and start it from that day. I have never ever gotten
the results they say you can get with their strategies. In fact I would say I
have been more prone to lose money than win.

jack
barnes May 16, 2012 @ 6:47 pm | delete

I
Have subscribed to vectorvest for two years and have had mixed results .Jack
Barnes

Hedge
Apr 11, 2012 @ 11:37 am | delete

VECTOR
VEST IS A COMPLETE WASTE OF MONEY....YOU DONOT NEED IT...AND IT IS
CONFUSING....JUST ANOTHER BS PROGRAM...

OK
let us resolve the key VectorVest question – does it work as claimed?

Well
we know for sure the dynamic duo of Cole and John
Stevens know – so here is a challenge to Cole and John Stevens, let us see your
summary of trades. After all when you go on national television and claim
something works – prove it!

Send the summary to me at info@gettingtechnical.com or direst
us to your social media site. So just to be sure – we need the summary of
trades from your institutional trading platform – not some spreadsheet you
created - block the account # that’s OK – we wait with great anticipation.

About Me

Bill has been writing a weekly business column in the Toronto Star since 1997, and was an early contributor to the former “Report on Business Television”. He has founded the Getting Technical Market Newsletter in December 1998.
Bill is also an Instructor for the Canadian Securities Institute. He is also a contributing author of the textbook for the technical analysis course offered by the Canadian Securities Institute (CSI. He is also called upon to provide training to industry professionals on technical analysis at many of Canada’s leading brokerage firms.
In February 2010 Bill became a technical sub-advisor to Stonebrooke Asset Management Ltd. who manages the Hybrid Investment Program under the Elite Wealth Strategies program for Union Securities Ltd..
The relationship ended in Feb 2012 but over the 24 month period the Hybrid Program enjoyed five technical selections that were the subject of takeover bids namely, Gerdau Ameristeel, El Paso Corp, Biovail Corp. Viterra Inc. and ShawCor Ltd